US inflation slowed last month for the first time since August

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(CNN) — US inflation took a breather last month for the first time since August. Prices still increased, but at a slower pace than in previous months.

The Consumer Price Index was up 8.3% in the 12 months ended in April, the Bureau of Labor Statistics reported Wednesday, slightly higher than economists had predicted. It was a decrease from the 8.5% recorded in March, which had been the highest level in more than 40 years.

Stripping out more volatile product categories like food and energy, the CPI stood at 6.2% over the same period, less than the 6.5% reported in March.

For April alone, prices increased by 0.3%, adjusted for seasonal swings, less than the 1.2% jump recorded in March. Without food and energy prices, core inflation rose 0.6%, more than the 0.3% advance in the prior month.

Wednesday's data suggests that the inflation peak is behind us, just as economists, the Federal Reserve, the White House and the American people hoped. But there are still a lot of factors that will keep prices elevated over the summer.

The war in Ukraine has put pressure on energy and food prices. Meanwhile, renewed Covid-related lockdowns in China threaten to exacerbate the supply chain issues that the world has been struggling with over the past year. That means it's uncertain how much the pace of inflation can slow down until these things are resolved.

On top of that, inflation has shifted from goods to services as it spread through different parts of the economy and is no longer constrained to categories that have been explicitly affected by the pandemic or geopolitical events, such as used cars or gas. That could mean that the high prices will be harder to shake when both of those factors wane.

"The peak of inflation may be behind us, but today's CPI report points to a long, slow descent or maybe even a plateau around 8% until prices start to drop significantly," said Robert Frick, corporate economist at Navy Federal Credit Union, in emailed comments.

What got more expensive?

April price increases were particularly stark for housing, food, plane tickets and new cars: Food prices rose 0.9% last month and 9.4% year over year, the biggest jump since April 1981. Grocery store prices were up 10.8% for the year ended in April, the biggest increase since November 1980.

However, energy prices fell in April as gasoline prices came down from their March peak. Over the 12-month period, energy prices soared 30.3%. In May, however, gas prices ticked higher again, so this part of the CPI could look worse again in next month's data.

Housing costs, which are comprised of rents and owners' equivalent rent for people who own their homes, rose in April by 0.5% for the third month in a row. Year-over-year, housing costs are up 5.1%. Because rents change infrequently, the Labor Department collects rent data from each sampled apartment or house only every six months.

Economists have been concerned about the increase in housing costs, which will likely stick around after other price peaks pass.

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